Edtech firm on Monday said that it has received a majority of the total votes polled in favour of increasing the authorised share capital for the rights issue.
The Bengaluru-based company noted that the voting process, comprising both the Extraordinary General Meeting (EGM) on March 29, 2024, and a postal ballot concluded on April 6, 2024, has been approved with a majority of 55% of the total votes cast.
It highlighted that the voting process has been duly scrutinised by an independent third party.
However, the condition set by the NCLT prevents the edtech company from utilising the funds.
“We are grateful to our investors for their support and understanding during this pivotal phase. Their invaluable support in providing essential working capital underscores their collective commitment to our renewed growth push,” said Byju Raveendran, Founder and CEO of BYJU’S.
Earlier today, the beleaguered edtech firm also announced a reorganisation aimed at streamlining operations.
Apart from a severe liquidity crunch, BYJU’S is locked in a tussle with a group of prominent investors, including Prosus, General Atlantic, Chan Zuckerberg Initiative, and Peak XV.
It has claimed that some of its issues like unpaid salaries and vendor payment dues “were a result of irrational hostility from four foreign shareholders who chose frivolous litigation” as the rights issue is aimed at tackling the liquidity crunch.
The investors have sought to void the $200-million rights issue initiated in January by appealing to the National Company Law Tribunal (NCLT).
In an order dated February 27, the NCLT directed that the funds received by BYJU’S for the rights issue be placed in a separate escrow account, with instructions not to withdraw them until the disposal of the oppression and mismanagement suit filed by a group of four investors against the management of the company.
On April 4, during the first hearing at the NCLT Bengaluru bench following BYJU’S extraordinary general meeting on March 29 to increase the authorised share capital for the rights issue, the edtech firm sought arbitration in the matter concerning the dissatisfied investors.
The next hearing on the matter is scheduled for April 23.
Edited by Affirunisa Kankudti
